Multiple Trustees

AuthorSeymour Goldberg
ProfessionSenior partner in the law firm of Goldberg & Goldberg, P.C., in Woodbury, New York
Pages31-32
If the grantor of a trust selects two trustees to administer a trust, then
problems may arise if the trustees do not get along. Obviously, if there are
three trustees, then they may act for the most part by majority decisions.
A grantor may select multiple trustees to take advantage of the knowl-
edge and thought processes of more than one mind. In addition, if two or
more individuals are serving as trustees, then there is theoretically more
of a safety factor regarding the protection of the trust assets.
In the case involving multiple trustees, the trustees must be on the ball.
A trustee who merrily goes along with the actions of the other trustee(s) is
potentially on the hook if trust assets are administered improperly.
If a cotrustee does not agree with the actions of the other trustee(s),
then he or she must take appropriate action to prevent any improper acts.
State law will determine what action the cotrustee must take if he or she
does not agree with the position taken by the majority of trustees.
Many states have adopted a version of the UTC. For example, the
Maine version of the UTC is called the Maine Uniform Trust Code.
Section 703 of the Maine version of the UTC provides, in essence,
that a trustee who does not join in the action of another trustee may not
be liable for the action of the other trustee unless a serious breach of
trust is involved; then the dissenting trustee must take action to prevent
a cotrustee from committing a serious violation. If a serious violation has
occurred, action must be taken by the dissenting trustee to correct the
breach of trust by the cotrustee.
Obviously, the dissenting trustee should always notify the cotrustee(s) of
his or her objections in writing before the action is taken, in order to
document his or her position. If the infraction is not signicant, then the
dissenting trustee is not liable, provided that he or she has documented
the dissent. Always remember that a passive trustee may have signicant
liability if he or she goes along with a cotrustee who acts improperly.
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MULTIPLE TRUSTEES

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